Al Kosier: Unconventional Mechanisms necessary for financing SMEs

Al Sayed Al Kosier, chairman of Industrial Development & Workers Bank of Egypt, said the official sector of SMEs doesn’t exceed 10%; explaining that the prominent obstacle of the banks funding for these enterprises is the decline of credit worthiness.

In the session entitled “Unconventional Mechanisms for funding SMEs”, he said the proportion of these enterprises from the Egyptian banks’ portfolios doesn’t exceed 1 or 2%, and other times it reaches 6-7%.  He said the biggest challenge for these SMEs is to get the financing.

He mentioned that the highly cost of financing, in addition, the inability of SMEs’ owners to market their products or even saving the technological services are the prominent obstacles that these enterprises face.

Al Kosier suggested some of the unconventional ways for financing the SMEs such like depending on the NGOs.

And he emphasized that the banks should contribute to construct some of the companies that support SMEs such as factoring companies and credit inquiries companies.